WHO SAID WHAT: How Europe has been reacting to news of the new AML Authority - AML Intelligence
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WHO SAID WHAT: How Europe has been reacting to news of the new AML Authority

European MEP Sven Giegold

By Elizabeth Hearst for AMLi

German MEP Sven Giegold labelled the move as a “big step forward for Europe and its common market”, adding that “after the ECB banking supervisor and the EU public prosecutor, it is another move to strengthen EU integration” in the fight against financial crime. 

However Giegold warned that “the biggest danger is that the EU is not spending three years with institution building rather than enforcement of existing legislation”, and that the “EU Commission should now start infringement procedures because of the widespread lack of effective AML enforcement”. 

The new body will have an independent board to avoid national biases, a decision made on the back of perceived weaknesses of the European Banking Authority. The EBA has come under fire for failing to appropriately reprimand banks based in Member States. 

The body is also expected to have an impressive 250 individuals at the helm, with European Commissioner Mairead McGuinness telling the AMLi Boardroom Series event in April that it will serve as a watchdog and a facilitator, explaining that it will have “a number of different roles”. 

European Parliament Vice-President for EPP Group, Frances Fitzgerald welcomed the news, and said “given the numerous money-laundering scandals that have occurred in Europe in recent years”, she believes that “we need a standalone authority that has the power and scope to root out money laundering activities not just in the banking sector but also in other non-financial sectors” in order to tackle financial crime. 

Fitzgerald was critical of the current EU AML approach, and said “it is clear that there is too much fragmentation in the way the EU’s AML rules are applied”, which has “allowed loopholes which can be exploited on a cross-border basis”. 

The former Minister for Justice of Ireland stressed that “Europe cannot afford to be seen as a gateway for dirty money to be channeled to criminals”, adding that “the Commission is right to push for an extensive overhaul of the current system”.

Similarly, Treasurer of the European Parliament’s S&D Group, Eero Heinäluoma MEP welcomed the legislation, and said it was “urgently needed”, adding that the EU’s current approach “lack’s teeth”.

A spokesperson for the European Banking Authority said that “the EBA remains fully committed” to anti-money laundering and counter-financing-of-terrorism measures.

“We know we can play an important regulatory role in the future, working together with the new EU-level AML/CFT supervisor to address supervisory fragmentation, fostering efficient cooperation between all relevant competent authorities and continuing to make sure that [money-laundering/counterterrorism-financing] risks are being addressed effectively across all areas of supervision and throughout institutions’ life cycles,” the spokesperson said.

Who said what? Latest updates from Europe

Finnish MEP Eero Heinäluoma – S&D: “I welcome legislative reform in the field of the anti-money laundering, which is urgently needed. It is estimated that 2-5% of global GDP is laundered annually, with an overall recovery rate of illicit assets at just 1.1% in Europe, according to Europol.  The EU approach towards money-laundering, with a central role for EBA, clearly  lacks teeth’s, as demonstrated by scandals with Danske bank and ING over the last years.”

“The upcoming AML reform package should therefore propose an overarching reform to tackle money-laundering effectively in line with the EP recommendation of the 10th of July 2020: a single AML agency with clear powers and resources could be an important step forward – provided other bottlenecks, like the lack of  harmonisation of regulatory requirements, as well as a better cooperation on the level of the FIU and enforcement bodies, are properly addressed. “

“Furthermore it’s key that there is more EU cross border streamlining around the definition and prosecution of underlying crimes, which generate all these criminal proceeds. Europol can play an important role here as well. The public is demanding a real change in the system and now it is the time to deliver.”

German MEP Sven Giegold – Green: “The package is certainly a big deal, the years of pressure are paying off…The new architecture against money laundering is a big step forward for the EU and the common market…We need a zero-tolerance policy by the EU Commission against money laundering.”

“With uniform standards and more centralised supervision, the EU Commission is introducing important improvements to enable consistent action against financial crime”.

Irish MEP Frances Fitzgerald – EPP: “I welcome the news that the Commission is expected to propose the new EU anti-money laundering authority. Given the numerous money laundering scandals that have occurred in Europe in recent years, I believe we need a standalone authority that has the power and scope to root out money laundering activities not just in the banking sector but also in other non-financial sectors”. 

“It is clear that there is too much fragmentation in the way the EU’s AML rules are applied; this has allowed for loopholes which can be exploited on a cross-border basis”.

“Europe cannot afford to be seen as a gateway for dirty money to be channeled to criminals. The Commission is right to push for an extensive overhaul of the current system. I look forward to engaging on this legislation as a member of the European Parliament’s Economic and Monetary Affairs Committee”.

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